There are 3 pineapple business models in the Philippines, namely exclusive right, nucleus and production agreement.
The exclusive rights model is usually owned by large corporation where they have the rights to develop and plant large areas of land for a certain period of time in accordance with applicable laws.
In the second model, the nucleus farm, the large corporation collaborate with growers and small plantation holders where the company provides agricultural materials, including agro inputs, seeds and agricultural credit. while the grower is responsible for production where production is fully supplied to the core company.
Whereas in production contracts, growers and smallholders are responsible for production. Here, there is an agreement between farmers and processing and/or marketing firms under forward agreements, usually at predetermined prices for the production and supply of agricultural products
Collaboration with this corporation makes growers and smallholder farms benefit, including in terms of infrastructure facilities and transportation. The large corporation ussualy have their own chartered vessels and do not run into transshipment/cabotage problems which increase the cost of shipping.
Spanish rulers introduced the pineapple to the Philippines in the 19th century. Since then, this tropical fruit has grown to become one of the country’s major crops, in addition to the Philippines having become one of the world’s main pineapple producers.
Pineapples and their products are the third largest export of the country, after banana and coconut oil. The Philippines produces around 3 million metric tons (MT) of pineapples annually with over 70 thousand hectares (ha) of area planted. The majority of these are found in Mindanao, especially in Northern Mindanao, accounting for 60%, followed by SOCCSKSARGEN (South Cotabato, Cotabato Province, Sultan Kudarat, Sarangani, and General Santos City) with around 30%. Davao, Caraga, and Zamboanga are also key producers in the south. In Luzon, Bicol provides output around 5-6% , while CALABARZON (Cavite, Laguna, Batangas, Rizal, and Quezon), Cagayan Valley, and Central Luzon are also key producers.
Harvesting is done year-round, with April to July considered as peak time.
Local transportation infrastructure is well-established. Major producing regions are about 3-4 hours away from the port, and it may be more costly for farms in Bukidnon, which is at the center of Mindanao Island.
Source: International Labor Office, Research Department, working paper no. 52, title: Economic and social upgrading in the Philippines’ pineapple supply chain, November 2019
Requirement before export: The protocol agreed by the country doing importation (i.e., agreed procedures related to phytosanitary control and the postharvest chemical and residue levels allowed by the country that wants to import pineapples from the Philippines).The Pineapples from the Philippines must conform to the Phytosanitary requirements abroad: No insects or excess levels of regulated postharvest chemicals.
Pre-export process: Current demand is matched by the appropriate harvest. If a new order from a new buyer comes in, the supplier will need at least one week to check if their harvest has an excess. If not, they can either turn the order down or source it from another supplier or farmer.
Export process: Purchase order -> Supply availability check (lead time: at least one week) -> Advance deposit (70, 80 or 100%) -> Shipment preparation and shipping schedule booking -> Pack supplies (~1 day) and cargo moves to port -> Send shipping documents including phytosanitary permit and the Certificate of origin are processed to buyer -> Balance payment by buyers -> Original documents sent to buyer through courier.
Supply availability check usually takes the most extended time, and custom requests for packaging or design will add another week or so. Aside from packing, export documents and the whole process takes about 1-2 days assuming there are no delays.
Global GAP, ISO certifications, and other certificates are available upon the buyer's request.
Export of fresh pineapple shall be allowed only if:
1. the exporter is accredited by the Bureau of Plant Industry (BPI)
2. The fresh pineapple fruits are sourced only from registered growers, and,
3. fruits for export are processed in accredited packing facilities only.
The accreditation of the pineapple exporter, packing facilities & farm registration is regulated under the Memorandum Order No. 40 Series of 2012, entitled "Guidelines for the Accreditation of Exporters, Traders, Growers and Packing Facilities for the export of fruits and Vegetables"
All accredited exporters shall be assigned with their respective codes. The proper codling shall be stamped/placed in the boxes of the carton approved by BPL. This coding will identify the exporter, packing facility, production area, packing date, and box number per packing date. This coding will be maintained until the fruit reaches the port of entry.
Each consignment of fruit must be accompanied by a Phytosanitary Certificate issued by the BPI PQS. Additional declarations to be indicated in the Phytosanitary Certificate will depend on the requirements of the importing country.
Standards and specifications regarding quality have been determined in accordance with the standards applicable in the Philippines set by the Bureau Of Standard, The Philippines National Standard, PNS/BAFPS 09:2004 for Fresh Fruits - Pineapple, which generally classifies quality for some known varieties of pineapple s in the Philippines include ‘Smooth Cayenne’, ‘Queen’/Formosa, ‘Red Spanish’ and other varieties, based on the following parameters:
- characteristic color, the tops are green and characteristics of well-grown pineapples at shipment, and shall befairly green and relatively free from discoloration as received in the markets
- crown slips, the small, secondary top growths at the crown of the fruit
- diameter of the fruit, the greatest dimension measured at right angles to a line from top to butt
- fairly well-formed, the fruit is somewhat round or cylindrical in shape
- fairly well-developed eyes which show fairly normal development and are not badly misshapen
- mature, the pineapple has reached the stage of development which ensure a proper completion of the ripening process. The fruit shows a yellow green cast at the stem scar after removing
- similar varietal characteristics of the pineapples in any lot which are similar in shape, shell structure, crown and color of the flesh
- single top, the fruit has only one prominent crown
- well-formed, the fruit shows good shoulder development and is not lopsided or distinctly pointed and the sides are not noticeably flattened
- well-trimmed, the bract on the stem next to the base of the fruit has been removed and that the stem doesnot protrude more than ¾ inch beyond the base of the pineapple
- damage, any defect or injury which affects to varying degrees the appearance, eating and shipping qualities of the fruit
- compression, any mechanical injury on the peel of the fruit resulting in the presence of water soak and soft areas that makes it unsightly
- endogenous brown spot, a physiological disorder known also as blackheart characterized by brownish or grayish opa que areas developing at the base of fruitlets against the core. This is a form of chilling injury that may occur in the field or during postharvest and cool storage, and there are no external visible symptoms
- sunburn, injury due to high temperature characterized by bleached yellow area on the exposed side of the fruit. Severe sunburn causes a sunken, spongy brown skin lesion developing in the center of the bleached area.
There are tolerances on the quality based on the class of the fruits, that are:
- Extra class: 5% of the pineapple, by number or weight, may fail to meet the requirements of the grade but shall conform to the requirements of the next lower grade.
- Class I and class II: 10% of the pineapple, by number or weight, may fail to meet the requirements the minimum requirements.
The quality check starts before harvest and is checked throughout the process until container loading. The most commonly done quality check before harvest is the maturity check. Exporters may visit the farms to check for maturity and make order requests to farmers whether to proceed with the harvesting and de-greening process and send them to packing houses.
BPI checks the farms and packing facilities for quality checks. In ideal situations, if a supplier buys from a separate farm, an inspector should determine whether the pineapple is ready for harvest. This involves the application of maturity stimulators such as ethereal to have a homogeneous fruit color and loosen the fruit from the stem. Fruit is then harvested and brought to the packing facility to be washed in alum and chlorine solution and sprayed with food-grade fungicide. Quality inspectors at the pack site remove pineapple with defects, sort them according to sizes, weigh the boxes and load it onto containers.
The buyer may request a third-party inspection at their own expense. Pictures and videos may be sufficient in claim processing for suppliers.
Minimum requirement, in all classes, subject to the special provisions for each class and the tolerances allowed, the pineapples must be:
- whole, with or without the crown, and with or without the stem;
- fresh in appearance, including the crown, when present, which should be free of dead or dried leaves;
- sound, produce affected by rotting or deterioration such as to make it unfit for is excluded;
- clean, practically free of any visible foreign matter;
- practically free of pests affecting the general appearance of the produce;
- practically free of damage caused by pests;
- practically free from mechanical damage such as pronounced blemishes
- practically free from physiological damage such as low and/or high temperature
- free of abnormal external moisture, excluding condensation following removal from cold storage;
- free of any foreign smell and/or taste;
- total soluble solids content in the fruit flesh should be at least 12 Brix
The pineapples must have been carefully picked and have reached an appropriate degree of development and ripeness in accordance with criteria proper to the variety and/or commercial type and to the area in which they are grown. The development and condition of the pineapples must be such as to enable them:
- to withstand transport and handling, and
- to arrive in satisfactory condition at the place of destination
The Pineapples are classified in 3 classes defined as the following:
1. “Extra” Class
Pineapples in this class must be of superior quality. They must be characteristic of the variety. They must be free from defects, with the exception of very slight superficial defects, provided that these do not affect the general appearance of the produce, the quality, the keeping quality and presentation in the package. The crown, if present, shall be simple and straight with no sprouts.
Tolerance: 5%F by number or weight of pineapples not satisfying the requirements of the class, but meeting those of Class I or, exceptionally, coming within the tolerances of that class.
2. Class I
Pineapples in this class must be of good quality. They must be characteristic of the variety. The following slight defects, however, may be allowed, provided that these do not affect the general appearance of the produce, the quality, the keeping quality and presentation in the package:
- slight defects in shape;
- slight defects in coloring, including sun spots;
- slight skin defects (i.e. scratches, scars, scrapes and blemishes) not exceeding 4% of the total surface area of the fruit The defects must not, in any case, affect the pulp of the fruit. The crown, if present, shall be simple and straight or slightly curved with no sprouts.
Tolerance: 10% by number or weight of pineapples satisfying the requirements of the class, but meeting those of Class II or, exceptionally, coming within the tolerances of that class.
3. Class II
This class includes pineapples which do not qualify for inclusion in the higher classes, but satisfy the minimum requirement